In Depth

Four top tips for managing your money in 2017

Shopping around for interest rates, a better mortgage deal and your energy tariff could save a bundle

The new year is almost upon us and with it the inevitable resolutions.

Alongside your promises to eat less, move more and learn a foreign language, the chances are you want to manage your finances better – those are the most popular resolutions after all. So, here are four ways to improve your finances in 2017.

1. Get the best interest rate on your savings

The new year is a great time to take a look at your savings accounts and see if you could boost your returns by moving to a better account. Interest rates may be pitiful but the good news is experts think they could start to move up in 2017.

“With inflation moving towards the Bank of England’s 2% target quicker than expected, the only way is up for interest rates in 2017,” says Nick Dixon, investment director at Aegon, in the Express.

If interest rates do start to rise in 2017 you don’t want to be tied into a lengthy fixed-rate bond that means you miss out. Luckily, the interest rate difference between long-term bonds and short-term is minimal at the moment. 

Atom Bank is paying 1.4% on its one-year bond. Alternatively, if you have less than £2,500 to save then Nationwide is paying five per cent on its FlexDirect current account, but you will have to pay in at least £1,000 a month.

2. Remortgage while rates are low

The good news with low interest rate is that mortgage rates are amazingly low at the moment. Rates are starting to slowly tick up with the best offers – such as HSBC’s 0.99% two-year fix – disappearing from the market.

But, if you haven’t remortgaged for a couple of years you could still save yourself a fortune with deals on offer for as little as 1.17%.

Someone with a £200,000 25-year mortgage switching from a rate of four per cent to 1.17% would cut £285 off their monthly repayments and save themselves £6,855 over two years.

3. Check your energy deal

Several energy firms have announced they are freezing their prices over the winter, but this means come the spring your energy bills will rise. Avoid the problem by shopping around for a good fixed rate deal now.

Grab your latest energy bill and spend a couple of minutes on a comparison website to see how much you can save. The regulator's price comparison table suggests that the difference between the worst standard tariff and best fixed rate in the market is over £300.

4. Move your debts

Did you build up some credit card debt in 2016? Now’s the time to get on top of repaying it. Consolidate it onto one interest-free balance transfer card and you can repay it over a number of years without any interest increasing the debt. 

The longest deal available is Halifax’s 41-month balance transfer card but it comes with a hefty 3.18% balance transfer fee. If you don’t need that long to clear your debt try Barclaycard’s Platinum 24 month interest free card that is has no fee.

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